Fake news – Does the Brexit dividend really exist and will it really benefit the NHS?

June 26, 2018

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Tony Hughes, CEO at negotiation specialists, Huthwaite International, provides his comments about the Brexit dividend and if it really will benefit the NHS:

The Prime Minister has announced an extra £20 billion a year for the NHS, thanks to a Brexit dividend and ‘the country contributing a bit more’. Since then, Labour’s Deputy Leader Tom Watson has demanded that the Advertising Standards Authority take action over a ‘misleading’ poster, calling the claims ‘at worst a complete myth.’ The announcement, designed to build momentum and positive opinion around the UK’s Conservative Party, has opened the flood gates to confusion and wild speculation, leaving people questioning what games are once again at play within UK politics and what May’s real agenda is.

Controversial claims

May has been brought into question because, on the surface at least, many claim her statements regarding the Brexit dividend don’t stack up.

The plans were unveiled on Sunday by the Prime Minister, who argued the funding boost would equate to an average increase of 3.4% every year for the next five years. As part of the announcement, the Vote Leave’s contentious NHS promises were also referenced, leading many to question the sincerity of the announcement.

Fuel was added to the fire with the Institute for Fiscal Studies stating: “there is no Brexit dividend” and that any funds as a result of a dividend are tied up in the divorce bill and the Government’s commitment to replace EU funding, which “already uses up all of our EU contributions in 2023.”

So, with no alleged Brexit dividend on the table, and any spare funds tied up in the divorce bill and ongoing EU contributions, what is May’s agenda, and is the NHS being used as a pawn in a global game of politics?

Fake news or part of a savvy negotiation?

On one hand, May could be privy to funding that the UK isn’t aware of, and the mathematics behind the alleged Brexit dividend will indeed stack up. However, given the £20 billion figure is significantly higher than Labour’s previous NHS pledge, there is another argument that this is in fact, a Power Play, an exercise to get the UK on-board with tax increases and heightened public spending, not to mention strengthening her negotiating hand in Europe.

To put this latter claim into context, we have to look at the negotiation techniques currently being used on the global stage. Consider Trump and North Korea, most notably the infamous “My button is bigger than yours” comments. This was a classic Power Play, and while this turned out to be successful, May’s approach – if indeed this is what she is doing – may not.

Perhaps May knows that the NHS is something the UK by and large holds dear, and this is a move to get the UK on side. As an area she understands people are perhaps more lenient to as a justification to raising taxes and increasing public borrowing, in doing so she is buying herself public support, and ultimately giving herself a position of strength as she finalises her efforts as part of the EU withdrawal negotiations.

May could be seen to be using this Power Play as part of her negotiation stance, both with her own constituents, in the EU, and importantly also with world powers such as the US. With her house in order, May could be aiming to position herself as a powerful leader; a veritable force to be reckoned with. A force that will boost trade for the UK, introduce new import links, reasonable trade tariffs and create an environment in which her country can grow and prosper, despite the predicted odds. With the UK united behind her and capable of delivering major change and safeguarding institutions domestically, she aims to be perceived as being on a much surer footing when negotiating with parties especially outside of the UK – which will undoubtedly strengthen her hand, giving her greater leverage.

However, whilst many implement Power Play as a level or bargaining chip for future deals, it often has an adverse effect and can in fact damage future relations and reputation. Relationships and a quality reputation can take a lifetime to build, but seconds to destroy. Once the toothpaste is out of the tube, it’s difficult to put it back. Crucially, May should be aware of this as she positions herself for the final Brexit negotiations. If she appears contrived or insincere in any way, she risks her reputation and in turn the relationships she’s built to date.

The art of the deal

Whilst we’ve seen risky negotiation tactics result in success of late, May must tread carefully to master a truly viable break from the EU.

If she is making false claims, or being overly confident in her announcements, then this can actually work against her credibility. If her announcements don’t stack up and can be pulled apart by those in her own country, then it doesn’t set May in the best of stead when it comes to the crucial final negotiations with the EU.

As she moves past Brexit to deliver new trade deals to the UK, May must position herself as credible and accountable to all parties. A leader that will work in partnership with the EU to deliver a mutually beneficial agreement. Being associated with anything remotely contentious or falsified at this stage of the Brexit negotiations could seriously undermine May’s position of authority and leadership.

To really succeed at Brexit, May must behave in a strategic, considered and measured way. Demonstrating a willingness to negotiate and listen in a level headed, practical and realistic way. Announcing a £20 billion investment – if the money isn’t currently available – is arguably working against this approach.

The UK has until October to truly get its house in order, and the focus must be placed on securing a quality trade deal and divorce bill. Distraction methods and power plays to manipulate public opinion – if that is what we’re seeing – risk wasting precious time.